Company naming advisory committee to create compliance program

Oct. 1, 2013

Written by

Walter F. Roche Jr.

The Tennessean

Pilot Flying J’s top executive says that an audit of its dealings with trucking company customers has been expanded “pretty dramatically” to cover some 7,000 accounts dating back to 2005.

In a Monday news conference at the truck stop company headquarters, Pilot CEO James A. Haslam said the expanded review covered all of the company’s customers with any type of a discount agreement.

The progress report, as Haslam noted, comes some five months after federal agents raided Pilot’s headquarters, seizing records in an investigation of allegations that the company had cheated its customers out of millions of dollars in promised rebates.

Declining to give specifics or to answer questions, Haslam said that the ongoing audits had shown that “a relatively small number” of its customers were victims and all of those had been paid back with interest.

Seven former Pilot sales executives already have entered guilty pleas in the ongoing investigation, and Haslam noted that others, whom he did not name, have been placed on administrative leave pending the results of an internal investigation.

Haslam said that other efforts, in the wake of the investigation, were progressing, including the appointment of an advisory committee to help create an internal compliance program. Among the appointees is Stanley Brand, a Washington, D.C., attorney, who once served as an aide to then U.S. House Speaker Thomas P. O’Neill Jr.

He said another ongoing effort was reducing to writing every one of its agreements with trucking companies.

Haslam said he was hopeful that a proposed settlement of civil lawsuits would win approval from a federal judge. A hearing on that agreement is scheduled for Nov. 25 in Little Rock, Ark., before U.S. District Judge James Moody.

More than 20 suits have been filed against Pilot in state and federal courts across the country. All cite a filing in U.S. District Court in Knoxville in which an FBI agent detailed the allegations of cheating customers out of promised rebates. The affidavits cite transcripts of a secretly taped Pilot sales meeting in which the rebate scheme was discussed.

“This has been a very humbling, embarrassing time,” Haslam said, adding that the company has continued to do well in spite of the recent developments.